Teacher Recommendations - are they truly helpful?

About two thirds of colleges use recommendations. Seems like most of them are not so highly selective that they get many applicants who are so exceptional to merit an exceptional recommendation (and such applicants are likely to be easy admits by other criteria), so if they dropped the requirement for recommendations, they would reduce the uncompensated work they give to teachers and counselors. The teachers and counselors can then concentrate on fewer recommendations for more exceptional students, and be less likely to need to ration recommendations.